Buying Property at a Discount - What Services do you Need and When

Professional Advice on Buying at a Discount

So many people offer this service but they are mostly property sourcing companies that want to find properties and charge you thousands for the privilege. Most of these, to be honest, we don’t really trust.

Few property sourcing companies do a really good job at finding you a property ‘below market value’. Those that do will charge you thousands for the privilege. Worst still, many are now being taken to court (speak to Paul Shamplina at Landlord Action) for taking investors' money upfront and then never finding a property for them. These are the ones to avoid:-

1. They won’t let you visit the property but offer you a ‘similar’ one to view.2. You have to use their recommended mortgage advisor and conveyancing company. 3. They charge thousands to find you one.

Instead, it’s better to try to source your own via auctions (Eigroup), speak and build relationships with local letting and estate agents; solicitors who are carrying out probate requests (ie properties for sale from people that have passed on) and developers who might have people that want to buy their property but can’t sell theirs.

Pre-offer Valuation Services

You need to find reputable and experienced companies and experts to help you with this. Look at finding a surveyor that can work for you on a regular basis, or you could buy into valuation services that Rightmove and Hometrack offer. We do offer desktop valuation services for £99 per property (inclusive of VAT).

There is no point hunting for a property until you know what you can borrow. Internet sites are OK to give you a guide, but you should really visit an independent financial advisor (IFA) that will take into account all your expenditure and income. They will be able to advise you not just on your mortgage but also insurance and making sure if something went wrong, your mortgage would be paid off.

If you are buying at a discount you need to be aware that any incentives such as help with deposits or guaranteed rental schemes need to be declared to the mortgage company. You CANNOT buy a property these days and declare to the mortgage lender you have paid £100,000 if you are only actually paying £80,000. You can also talk to a mortgage broker, local banks and building societies as not all mortgage deals are sold through IFAs.

Legal Company

Its essential to find a good legal company that will work in your interest and to your time scales, especially if you are getting the discount because you are buying quickly. Don’t wait until you make an offer to choose a legal company, find one that agrees to act quickly before you start looking or when you start making second visits to properties.

As with a legal company find a good surveyor that agrees a fixed price to value properties for you quite quickly, as securing an offer based on a ‘quick sale’ and waiting three weeks for a surveyor to pop round isn’t going to help you bag a bargain. It is quite possible you’ll need to get them to go into the property prior to making your offer.

NEVER rely on the mortgage company’s valuation when buying for investment purposes, it’s a false saving and you will end up losing money or negating your discount with work you have to carry out.

Finally, don’t think if you are buying a new home that you don’t need a survey! Get yourself a ‘snagging’ survey and make sure your legal company knows to exchange and complete ONLY ‘subject to’ an independent snagging survey.